Shares of Packaging Corp of America (PKG) plummeted 7.27% in pre-market trading on Wednesday after the company reported lower-than-expected fourth-quarter earnings, impacted by rising operating costs and higher expenses.

The containerboard and corrugated packaging manufacturer reported a net income of $221 million, or $2.45 per share, for the fourth quarter of 2024, missing analyst estimates of $2.54 per share. Revenue also fell short of expectations, coming in at $2.1 billion versus the forecasted $2.13 billion.

Despite higher shipments and prices across its Packaging and Paper segments, PKG's profitability was weighed down by various cost pressures. These included higher operating costs, scheduled maintenance expenses, increased depreciation, and elevated freight and logistics expenses.